4.3.2Active indicatorNet Value of Fossil Fuel Subsidies and Carbon Prices
4.1The economic impact of climate change and its mitigation
4.2The transition to net zero carbon, health-supporting economies
4.3Financial transitions for a healthy future
Indicator 4.3.2 · Economics
Net Value of Fossil Fuel Subsidies and Carbon Prices
Fossil fuel use drives climate change and exposes people to health-harming air pollution. Carbon pricing can support the transition away from fossil fuels by increasing the cost of greenhouse gas emissions, while fossil fuel subsidies work in the opposite direction by making these fuels cheaper and slowing the transition to cleaner energy. This indicator compares fossil fuel subsidies with carbon-pricing revenues to estimate net economy-wide carbon prices and revenues across 87 countries responsible for 93% of global CO₂ emissions.
Headline finding
The 87 countries reviewed provided a net US$808 billion subsidy to fossil fuels. In 80% of countries, fossil fuel subsidies outweighed carbon-pricing revenues, resulting in a negative net carbon price, while 10 countries spent more on fossil fuel subsidies than on health.
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Figure 1
Pricing Greenhouse Gas Emissions
Net carbon price, net carbon revenue, and net revenue as a percentage of national health expenditure, comparing carbon pricing instruments and fossil fuel subsidies, in 2010 and 2024, by country, Human Development Index (HDI) group, Lancet Countdown region, or World Health Organization (WHO) region. Negative values indicate net subsidisation of fossil fuels.
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About this indicator
Description
This indicator calculates net, economy-wide average carbon prices and associated net carbon revenue to the government. The calculations are based on the value of overall fossil fuel subsidies (taking into account both budgetary transfers and tax expenditures), the revenue from carbon pricing mechanisms, and the total CO2 emissions of the economy. Positive results indicate a net tax on CO2 emissions, while negative results indicate a net subsidy for fossil fuels.
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Caveats
The economy-wide net carbon price was derived by dividing fossil fuel subsidies and carbon pricing revenues by total CO2 emissions. This fits well with the subsidies, as these are for fossil fuels, the principal source of CO2. However, some of the carbon pricing instruments from which the revenue was assessed are not only for fossil fuel combustion but apply to other sectors and non-CO2 gases.
Data sources
- Fossil Fuel Subsidies Database, 2025. International Energy Agency.
- OECD Inventory of Support Measures for Fossil Fuels, 2025. Organisation for Economic Co-operation and Development.
- World Bank Carbon Pricing Dashboard, 2025. World Bank Group.
- Greenhouse Gas Emissions from Energy, 2025. International Energy Agency.
- Global Health Expenditure Database, 2025. World Health Organization.
- World Economic Outlook Databases, 2025. International Monetary Fund.